US Herbal Sales Enjoy Record Rise

Annual sales of herbal dietary supplements in USA passed US$10bn for the first time in 2020, according to the American Botanical Council’s 2020 Herb Market Report, which is based on US retail sales data provided by SPINS and the Nutrition Business Journal. Consumers spent an estimated US$11.3bn, +17.3% vs 2019. This is more than double the annual growth reported that year and the first time the segment has experienced double-digit growth in at least two decades.

  • In mainstream US retail outlets, elderberry was the top-selling herbal supplement ingredient, with sales totalling US$275mn+
  • Ashwagandha root had the largest percentage sales growth (+185.2%) in the mainstream channel. Widely used in Ayurveda, the well-known adaptogen is believed to increase the body’s ability to adapt to different forms of stress
Source: SPINS (52 weeks ending 27th December 2020)
  • Apple cider vinegar supplements saw strong sales growth in both mainstream and natural retail channels, with those marketed for digestive health and “cleanse and detox” the top focus
  • Natural retail outlet shoppers also prioritised fungi supplements, including some marketed for immune and cognitive health such as Chaga, which made its first appearance among the Top 40 in the natural channel ingredients, although human clinical research is lacking

Comment from study co-author Tyler Smith: Consumer trends in herbal supplements have never been more pronounced – the pandemic’s effects on supplement purchases can be seen in almost every data point for 2020. Throughout the year, consumers sought out products commonly used for immune health, stress relief and digestive support, likely in response to pandemic-related stressors. However, sales of products for age-related concerns such as prostate and heart health also grew in 2020, which suggests that consumers were turning to herbal supplements for both acute and chronic conditions.

Now is your final chance to register to join Nicholas and the team next week for our North American e-Conference 2021, reviewing marketing solutions across the region. To register, or for further details, please contact elizabeth.bernos@NicholasHall.com without delay.

Three surveys assess Covid’s impact on our health

Three surveys published in recent weeks have gauged the impact of the Covid-19 pandemic on our dietary and supplement habits, our use of technology and our mental health. Here we present a quick survey of the findings in all three studies.

According to a survey of 13,000 people in 24 countries conducted by OnePoll on behalf of the Council for Responsible Nutrition and Herbalife Nutrition, eight in 10 US citizens believe their health is “work in progress”. Some 89% of respondents worldwide are taking steps to improve their health, with 81% reporting that the pandemic helped to kickstart them.

Vitamins and supplements are a priority for many; when asked about how their health goals have changed, half said they are more focused on eating healthier, including supplementing their diet with vitamins & minerals, with the average respondent spending around US$286 each year. However, only 69% reported feeling knowledgeable about the health benefits and 77% would like to know more. Some 30% are most likely to get information about vitamins and supplements from internet searches, media and social media, followed by consulting with their doctor (27%).

Source: OnePoll / Herbalife / CRN

According to a survey from Saudi-based cultural institute Ithra, 91% of people globally are spending more time online because of the pandemic, and 44% are worried about the impact of internet and smartphone use on their health. Respondents in Sub-Saharan Africa and South Asia appear most worried, with 74% and 56% respectively fearing the negative consequences of the internet on wellbeing vs 27% in Europe and Central Asia. Consistent with their increased use of devices, younger people are experiencing more physical symptoms than their elders, with 50% of Gen Z respondents complaining of tiredness, poor sleep and headaches.

And, finally, a study published in BJPsych Open revealed the mental health of adults aged over 50 has been significantly compromised by Covid-19. University of Surrey researchers analysed data in 5,331 participants from the English Longitudinal Study of Ageing. Self-reported depression in June and July 2020 were compared with baseline data from 2-3 years prior. Some 26% met the criteria for clinical depression during the pandemic vs 14% in previous years. Women were found to be at a much higher risk, as well as people living alone and those with long-term health conditions. Women living in an urban environment showed a larger increase in depression symptoms than those in more rural areas. The research also found that individuals at the younger end of the 50+ population suffered more.

In just 2 weeks, you can join Nicholas and a panel of industry experts at our North American e-Conference 2021Sponsored by Catalent, you can look forward to hearing about consumer shopping behaviours, the non-prescription imperative, natural channel retail world and much more. To register, or for further details, please contact elizabeth.bernos@NicholasHall.com.

ADM Survey: Behaviour Shifts Create CHC Opportunities

Some 60% of consumers plan to improve their overall health & wellness in the next 12 months, according to Archer-Daniels-Midland (ADM), which transforms natural products into ingredients and flavours for foods & beverages, supplements, pet nutrition and more. There is also a more proactive approach to managing wellbeing with functional nutrition, close-to-nature ingredients and foods that signal self-care. ADM has identified five behaviour shifts that are creating opportunities for manufacturers to support evolving needs:

  • Renewed motivation to improve individual health & wellness Pandemic experiences have varied across the globe, but an almost universal takeaway is the renewed focus on preventive health & wellness behaviours. Products designed for all life stages will help consumers protect themselves, their families and their communities
  • Holistic approach to managing mind-body connection 51% of consumers plan to improve their cognitive and mental health over the next 12 months. As we return to more active lifestyles, convenient products with functional ingredients that boost energy, enhance cognitive performance & regulate mood are gaining prominence
  • Tailored nutrition supports personal health & wellness goals Nearly two-thirds of consumers are interested in customised foods & beverages. A greater understanding of how diet can impact health is spurring more people to choose wholesome, nutrient-dense ingredients, with particular focus on fibre & protein. As the chart below from our CHC New Products Tracker database indicates, the number of new personalised VMS products launched has grown sharply in recent years
  • Proactive perspective on immunity With 65% of consumers more concerned about immunity, there is a shift from a defensive to a more proactive & holistic approach. People are looking for ways to incorporate immune function-supporting solutions like probiotics and vitamins C & D into their daily lives. Products with functional ingredients that support a healthy immune system will increasingly attract consumer attention
  • Purposeful indulgence new “permissible indulgence” During the pandemic, many people have given themselves permission to consume indulgent food & beverages as a form of self-care. Consumers are recognising that, as long as these are purposeful — not impulsive — choices, indulgence has a role in a positive relationship with food

Nicholas Hall’s Touchpoints: The ADM research tells us nothing we didn’t know already, but as always it’s good to put numbers to the various consumer trends, and to be reassured that these trends continue as we head towards the second anniversary of this shocking pandemic. The same is true of the birth rate data in our second lead story. At the outset of Covid-19, with the expectation that a large part of the world’s population would spend much more time at home, we all assumed that the birth rate would go up, which is the reverse of what actually happened. As The Consumer remains at the centre of our industry, we are well advised to take seriously behavioural trends such as these as we shape future strategies and return to the New Normal. A longer-term trend underpins our third lead story this week, with Catalent’s acquisition of one of the leading manufacturers of gummies, a delivery system popular with adults as well as children that has taken the US market by storm and which is poised to do the same in the rest of the world.

You can save with the early bird booking discount when you register to attend our APAC e-Conference 2021 before 21 September! Taking place on 23 November, join Nicholas and the team to Face the Future together. Stay tuned for new additions to the agenda! Plus, this event will also host the Nicholas Hall CHC Marketing Awards for the region. To find out more about the conference, entry submission criteria, or to book your place, please contact elizabeth.bernos@NicholasHall.com.

RB sales +11.8% in 2020; Biofreeze in, Scholl out

RB recorded its highest-ever sales increase in 2020, with net revenue up 11.8% on a like-for-like basis to £14bn (US$20bn). Health grew by 12.1% to £4.9bn (US$6.9bn), while Hygiene sales had an even better year (+19.5%) in 2020 and Nutrition sales were flat. E-Commerce sales grew by a record +56% in 2020 and now account for around 12% of group net revenue.

In Q4 2020, total RB net revenue was £3.6bn (US$5.1bn), +10.2%. Health grew by 2.8% to £1.2bn (US$1.7bn), with strong growth for Dettol, Durex and Gaviscon partially offset by the expected impact of the weak cough, cold & flu season, which resulted in the OTC portfolio being down just over 20% in the quarter. Hygiene (+25.7%) was even more the main growth driver for RB in Q4, while Nutrition sales were 3.5% lower, with excellent growth for Airborne and Neuriva offset by lower sales for Infant & Child Nutrition products in Greater China; a strategic review of the infant formula business in China, which represents 6% of group revenue, is underway. E-Commerce sales were up 50% in Q4, accounting for around 13% of total group revenue.

At the same time, RB announced it has entered into a definitive agreement to acquire the Biofreeze brand from US-based Performance Health (Madison Dearborn Partners). Financial terms were not disclosed. In USA, Biofreeze is the No.1 clinically-recommended topical pain relief brand and has delivered robust double-digit sales growth. “We see compelling opportunities to develop the topical pain relief category globally with Biofreeze and other RB pain management brands including Nurofen, Moov and Tempra,” said RB CEO Laxman Narasimhan. “The brand taps into the growing global trend for wellness and self-care and aligns with our strategy to build our US Health footprint into new spaces and places.” The deal is expected to close in Q2 2021.

In addition, US-based private equity group Yellow Wood Partners has agreed to acquire RB’s Scholl foot care brand, which operates globally outside of the Americas, for an undisclosed sum. The acquisition will reunite Scholl with the Dr Scholl’s brand – operated by Yellow Wood as a standalone company since its acquisition from Bayer in 2019 – as one entity after more than 30 years of separate ownership. The combined company, which generates annual retail sales in excess of US$700mn, with leading market shares in the global foot care category, will operate in 50+ countries. The deal is expected to be completed by Q3 2021.

Now is your final chance to register for our webinar on 3 March focusing on Mental Wellness across the Americas — join Nicholas Hall and Jennifer Cooper to explore the Sleep, Memory & Mood markets. For more information, or to take a look at the full schedule of webinars for 2021, please contact elizabeth.bernos@NicholasHall.com.

IRI: Top Product Claims, Retail Trends

New research by IRI points to some of the consumer retail trends that have emerged in the US market in the past year as a result of Covid. Looking at the entire CPG (consumer packaged goods) market in the USA, IRI’s recently published Leader Board report for 2020 highlighted some key trends, including consumers of all income levels driving more growth of premium and super-premium products, with health and wellness and self-care products experiencing higher demand. Among the fastest-growing categories in 2020, IRI listed home health care / kits (+172%), personal thermometers (+127%) and sleeping remedies (+28%).

The report also lists some of the marketers and categories that benefited from the strong shift to e-Commerce, including Vi-Jon (marketer of hand sanitiser Germ-X) and external analgesic rubs, as well as highlighting the leading product claims among both edible and non-edible consumer goods. As the chart below from the report indicates, “more vitamin C” was one of the fastest-growing claims in terms of sales (+24%) in the edible sector, while hemp seed oil (+110%), aromatherapy (+37%) and sleep health (+34%) were all in the Top 10 non-edible product claims in 2020.

Copyright: 2021 Information Resources Inc. (IRI).

Further IRI research found that small and extra-small CPG manufacturers’ and retailers’ own brands gained US market share vs larger players during 2020. Of the CPG industry’s US$933bn sales in measured channels in 2020, large manufacturers lost 1.3 share points (US$12.1bn in sales) to smaller players, owing to channel and category shifts and supply constraints. The CPG industry grew 10.3%, with smaller manufacturers (annual measured channel sales <US$1bn) capturing nearly one-third of that and private label products accounting for roughly 18%. This resulted in smaller manufacturers and PL gaining 1.1 and 0.2 share points, respectively, from larger manufacturers (measured channel sales exceeding US$5.5bn annually), which have lost market share in each of the past five years, but still represent 46.7% of total US sales in measured channels.

Comment from President of Strategic Analytics for IRI, Dr Krishnakumar Davey: The consumer shift towards smaller manufacturers and PL products is something that IRI has been documenting for several years, and we saw the trend accelerate during the pandemic. Many large manufacturers were not able to meet the surge in demand in Q2 when they lost most share to smaller players, who seized on this opportunity. Several brands attracted a number of new buyers as in-home consumption surged. Large manufacturers fared relatively better in Q3, but still lost significant share. Q4 saw some improvement and reversion to historical trends. Many extra-small manufacturers are mostly new entrants to the market into supply-constrained categories (e.g. soap, hand sanitisers, home healthcare kits). Small manufacturers playing in high-demand categories such as hygiene, personal care and health & wellness saw high growth.

Nicholas Hall will be joined online by experts from GSK, J&J and Convert Group during our European e-Conference 2021. Taking place on 28 & 29 April, there are options for individual passes or corporate licences. Take the chance to keep up with what’s happening in consumer healthcare today by contacting elizabeth.bernos@NicholasHall.com to reserve your space.

MAT Q3 Update: Category, country performances

Assessing the latest data on the performance of the global CHC market in MAT Q3 2020, Celine Waller, Group VP, DB6, wrote: “Covid-19 continues to have a seismic effect on the CHC market, although the impact of the pandemic differs depending on the category and geography. However, in totality the market has continued to outperform expectations with the increased focus on maintaining health & wellness providing a welcome boost to the industry.”

Vitamins, minerals & supplements (+6.0%) was the fastest-growing major category in MAT Q3, benefiting from the greater focus on wellness, with products connected to immunity particularly dynamic – overall, immune supplement sales rose by 47% globally. This trend was particularly noticeable in the world’s No.1 CHC market, USA, where immune supplements, as well as zinc and vitamin C supplements, all recorded exceptional growth.

Dermatologicals also performed well, increasing by 5.9% thanks to a surge in demand for antiseptics & disinfectants, which grew by 51% globally, owing to RB’s Dettol making big gains in key markets like China, and various successful launches in the USA. Meanwhile, analgesics achieved growth of 5.0% thanks to the strong performance of systemics (+5.9%), powered by the continued dynamism of global No.2 CHC brand Tylenol (J&J). Topicals mustered growth of only 3.2% in spite of the US switch of GSK’s Voltaren Arthritis Pain.

Cough, cold & allergy (+2.2%) was the weakest category globally in MAT Q3 2020, as social distancing and increased hygiene measures resulted in reduced incidence of respiratory pathologies. Declining sales for cough & cold remedies across western Europe, most noticeably in Germany and France, was the primary factor for the poor performance of these markets in MAT Q3 2020.

Gastrointestinals also produced low growth, with global sales increasing by just 2.8%, after a flat performance in western Europe and falling sales in Japan. In fact, heavy decline for GIs and OTC tonic drinks were two key factors behind the 5.1% fall in Japan’s CHC market. Liver & bile remedies (+5.2%) was the only GIs subcategory to achieve growth of more than 5% globally, powered by a double-digit rise in China.

Sales of Lifestyle CHC products expanded by 3.7%, a further deceleration in Q3, despite double-digit growth for sedatives & sleep aids and obesity treatments. A slowdown in sales of eye care treatments and a drop-off in Rx-to-OTC switch activity are two of the primary factors for this deceleration globally, though one exception is erectile dysfunction, which grew by double digits powered by OTC switches in the UK and Poland.

We are pleased to announce the latest DB6 MAT Q3 data is now available! With over 150,000 pieces of data across 63 markets, DB6 now includes topline data across all channels of distribution, including e-Commerce! To find out more about our extensive database or to set up a free demo, please contact kate.holdcroft@NicholasHall.com.

Star VMS Performers in MAT Q2 2020

Global sales of vitamins, minerals & supplements in the MAT Q2 2020 period advanced by 5.5%, a further clear upturn vs Q1 2020 and Q4 2019, and a trend that helped to offset the Q2 slowdown for CCA remedies. Faster growth in North America’s vast supplements market (+8.8%) was the primary factor underpinning the accelerating trend globally, helping the region move back ahead of Europe in terms of CHC turnover in Q2.

In this week’s blog, we take a closer look at the VMS brands driving growth at both a regional and country level. In North America, as well as the continued rapid growth of J&J’s Tylenol, two VMS ranges that performed exceptionally well among the regional Top 10 brands were Nature’s Bounty (The Nature’s Bounty Co) and Olly (Unilever). New product development, such as the launch of the Olly Ultra Softgels line in April 2020, as well as the brand’s rollout to Canada in May 2020, have boosted Olly sales.

In Asia-Pacific, the standout trend has been the exceptionally high growth of chyawanprash supplements, up 121% globally – outpacing other fast-growing prevention categories such as immune supplements (+38.6%) and vitamin C (+23.5%) – driven by accelerating demand in India. Dabur Chyawanprash (Dabur) is now India’s No.1 OTC brand, after sales more than doubled in the 12 months to June 2020 thanks to surging demand in H1 as a result of the pandemic, and the brand has now also sneaked into Asia-Pacific’s Top 10 CHC brands regionally.

In Europe, growth was more muted across the board, with Top 10 brands like RB’s Nurofen and Bayer’s Bepanthen driving growth at a regional level. However, focusing on brand performances at a country level in Europe reveals the impact of VMS brands and natural-based sleep aids on growth, with Orthomol (+10.6%) rising fast in Germany, GSK’s single vitamin brand BE-Total (+16.2%) up strongly in Italy, P&G’s multivitamin Bion 3 (+16.0%) advancing rapidly in France and sleep aids Aquilea (+13.5%) and Dormidina (+11.3%) powering Q2 growth in Spain.

As for Latin America, Sanofi’s analgesics brands Dorflex and Novalgina were two of the best Top 10 performers at a regional level, while Bayer’s Redoxon (+65.7%) was the star performer, thanks to soaring demand amid the Covid-19 pandemic. In 2019-20, Bayer rolled out Redoxon Triple Action (vitamins C + D plus zinc; positioned for enhanced immune support) in numerous local markets.

With just under a month to go, there is still time to register to join Nicholas Hall’s Asia-Pacific webinar. On 12 November, Nicholas and other industry experts will explore key trends in the region, including a look at WOW! brands, growth prospects, distribution, the very important topic of sustainability and much more. To find out more, or to register, please contact elizabeth.bernos@NicholasHall.com.

Vicks and Tylenol still driving global CHC growth

Only two CHC brands have global sales in excess of US$1bn – P&G’s Vicks and J&J’s Tylenol – and both continued to power growth in Q2 2020. Vicks, like other leading CCA brands such as Halls (Mondelez) and Mucinex (RB), recorded a slowdown in Q2 owing to the “pantry unloading” effect, and reduced levels of coughs & colds caused by lockdowns, social distancing and hygiene measures, while VMS brands like Centrum (GSK) and Nature Made (Pharmavite / Otsuka) saw growth accelerate in the second quarter.

Despite slowing growth in Q2, global No.1 brand Vicks (+8.7%) remained at the heart of the CHC market’s upturn in the MAT Q2 2020 period. Dynamic growth for Vicks was powered by double-digit rises in Latin America and North America. In the brand’s key US market, Vicks was extended in July 2020 with Vicks VapoBath Bath Crystals, a new Vicks Children’s Botanicals line, Vicks Sinex Saline and Vicks Immunity Zzzs.

Once the leading global CHC brand, Tylenol has steadily been regaining share in recent years and closed the gap on No.1 Vicks after 21.4% growth in the MAT Q2 2020 period. In its Q2 results, J&J reported double-digit growth for its OTC products, driven by Tylenol analgesics. US sales account for around three-quarters of Tylenol’s global OTC turnover, and the brand has been boosted by innovations such as the Q2 2020 launch of Tylenol Extra Strength Dissolve Packs.

Systemic analgesic Advil is still the world’s No.3 CHC brand, but growth slowed (-0.4%) in the MAT Q2 2020 period after a strong return to growth in Q1, following weaker Q2 performances in the USA and Canada. New owner GSK is hoping to revive the US performance of Advil with the August 2020 launch of Advil Dual Action, the first FDA-approved OTC combination of ibuprofen and acetaminophen (paracetamol) in the US market.

Voltaren saw growth accelerate slightly in Q2 2020, up 4.9%, helping it rise above Halls into the No.4 position in the global CHC brand rankings. In February 2020, the US FDA approved the Rx-to-OTC switch of Voltaren Arthritis Pain (diclofenac 1%), and the product was subsequently launched in May 2020. This US launch, allied with stronger growth in regions outside Europe, helped to offset a Q2 slowdown for Voltaren in various key European markets such as Germany, Italy and the UK.

Medicated confectionery brand Halls fell into decline (-0.2%) in the MAT Q2 2020 period and dropped down the global rankings one place to the No.5 spot. Available in over 30 countries, Halls is the leading global sore throat & medicated confectionery brand and takes the No.1 position in Latin America, where it grew by 2.6%, thanks to solid growth in the brand’s key regional market of Brazil. However, sales in North America and Europe declined for Halls in line with the weaker CCA trend across both regions in Q2.

Have you registered to join Nicholas Hall’s Asia-Pacific webinar? On 12 November, Nicholas and other industry experts will explore key trends in the region, including a look at WOW! brands, growth prospects, distribution, the very important topic of sustainability and much more. To find out more, or to register, please contact elizabeth.bernos@NicholasHall.com.

CHC market shows resilience in Q2 2020

In the 12 months to end-June 2020, the global retail CHC market grew by 4.6%. This marked a slowdown vs MAT Q1 (+5.6%), but Celine Waller, Group VP, DB6, said “the market has remained far more resilient than many expected”. A boom in prevention categories such as antiseptics & disinfectants (+38.7%) and immune supplements (+38.6%) has helped to mitigate the effect of “pantry unloading” following consumer stockpiling in Q1, while strong US growth in Q2 offset weaker performances in China and Western Europe.

Western Europe decelerated to 1.2% triggered principally by a decline in CCA as lockdowns and increased hygiene measures resulted in reduced incidence of respiratory pathologies. Low growth in Germany (+1.5%) and the UK (+1.9%) offset moderate declines in Italy (-0.8%) and France (-1.3%).

Asia-Pacific slowed to 2.7% hindered by a weak performance in China and declines in both Japan (-2.9%) and Australia (-1.3%) caused by loss of revenue from Chinese travellers. However, India was up 11.3% driven by chyawanprash, which more than doubled thanks to its immunity positioning.

North America posted a 6.4% upturn with strong US growth spearheaded by VMS (+8.8%) and Derma (+8.4%) – the latter boosted by a doubling in sales of antiseptics & disinfectants.

Central & Eastern Europe achieved growth of 8.6% with inflation-driven growth in Russia (+10.9%) offset by a comparatively weak performance in Poland (+5.2%), while the Middle & East Africa experienced a slight slowdown (+6.9%).

Latin America grew by 11.8% with both Brazil (+12.0%) and Mexico (+11.0%) up by double digits. VMS was the key contributor growing by 16.7% in the region.

We are pleased to announce Nicholas Hall’s Asia-Pacific webinar, which will be held on 12 November! Nicholas will be joined by several regional industry experts to explore key trends in the region, including a look at regional WOW! brands, growth prospects, distribution and much more. For further details, or to register, please contact elizabeth.bernos@NicholasHall.com.

US Herb Market Report shows dynamism of immunity supplements

In this week’s blog, we look in more detail at the American Botanical Council’s 2019 Herb Market Report, which is based on US retail sales data provided by SPINS and the Nutrition Business Journal. According to the report, US consumers spent an estimated US$9.6bn on herbal dietary supplements in 2019, an 8.6% increase vs 2018.

For the first time, CBD made the list of 40 top-selling ingredients in the mainstream channel, where it ranked 9th at just under US$36mn, up 872% vs 2018. For the second year, CBD was the top-selling botanical sold as a dietary supplement in natural retail outlets.

Sales of immune health-related ingredients also rose sharply. In H1 2020, elderberry had the second-highest increase in the mainstream channel (+241%), making it the third top-selling ingredient; it was up 126% in the natural channel. Echinacea grew by 50%+ in both channels.

Other herbal & natural ingredients that have performed well include oregano (up 75% in the natural channel and 91% in the mainstream channel in H1 2020), which is positioned for respiratory symptoms such as cough, as well as astragalus root and mushrooms / fungi-derived ingredients with an immunity positioning. According to SPINS, sales of mushrooms (other) advanced by 84% in the natural channel and an exceptional 495% in the mainstream channel.

The report indicates that while dietary supplements with immunity positioning were the primary growth driver in the US market in the first half of 2020, other VMS ingredients also performed well, particularly those with a stress or sleep positioning. As of mid-June 2020, supplement sales appear to have levelled off; but if H1 2020 is any indication, the US VMS industry is on track for another record-breaking year.

For the full report, go the American Botanical Council’s website and download the PDF link.

Also, ensure that you have registered to join Nicholas online on 30 September for an all-new hot topics webinarYou will hear about key trends, including the impact of Covid-19, Distribution, e-Detailing and Sustainability. To find out more or register to join, please contact elizabeth.bernos@NicholasHall.com.